Stocks of Indian jewelers and state-run banks have been sinking since Friday, when the full extent of what's now understood to be the largest bank fraud case in Indian history was unveiled in a complaint to Indian federal banking regulators filed by the the Punjab National Bank, a state-owned bank based in New Delhi.
The bank discovered the first bread-crumbs in January, but the full extent of the fraud - which was carried out over seven years and involved the theft of nearly $1.8 billion - wasn't known until very recently. And before today, when Reuters published a report fleshing out some newly uncovered details, little was known about the mechanics behind it.
The pressure has dragged the S&P BSE SENSEX - an index of some of India's most established companies - lower.
Last week, we learned that the fraud involved Nirav Modi, one of India's 100 richest men and a well-known jeweler who has dressed both Hollywood and Bollywood stars, was at the center of the conspiracy. He was aided by Mehul Choksi, whose Gitanjali Group of companies was intimately involved in the fraud. Finally, the third key conspirator was PNB branch deputy manager Gokulnath Shetty, who oversaw the circulation of fake "letters of undertaking" - essentially one bank vouching that a certain client is credit-worthy and should qualify for a loan from another bank.
From the broadest possible perspective, the fraud unfolded as follows: Modi and Choksi controlled a group of fraudulent jewelry companies. Shetty would circulate "letters of undertaking" vouching for collateral that didn't really exist. Based on these letters, the shell companies secured loans from foreign branches of India-based banks. This money then disappeared.
A fourth individual - a junior employee who worked for Shetty - is also being held but his or her involvement is still unclear.
But in the first major review of the case by an English-language media organization, Reuters said the details available overwhelmingly point to a shocking failure of oversight by both India's banking regulators and the state-owned bank's internal controls. As a result, criminals were able to steal early $2 billion from PNB largely because nobody was watching.
A review of bank and government documents related to the case - and interviews with current and former PNB executives, bank auditors and experts - points to a lack of accountability and standards in the country’s public banking system.
As of last September, those banks held about 87 percent of the Indian banking system’s 9.46 trillion rupees (about $147 billion) of soured loans that are non-performing, restructured or rolled over.
A preliminary investigation by the nation’s tax authority said of the PNB fraud that “the hit Indian banks would take in the end may well exceed” $3 billion, according to an internal note seen by Reuters.
“Yes, there is a problem. We have recognized it,” bank Chief Executive Officer Sunil Mehta said during an investor call on Friday. “We are in the process of fixing it up. We’ll see wherever the loopholes are there. The people-related risk, we are going to mitigate.”
But despite that promise of action, one current senior executive at the bank’s headquarters in New Delhi said further problems could not be ruled out.
“In Indian banks, we don’t work under ideal situation,” the executive, who declined to be identified, said during an interview at his office. “We are in the business of risk, you can’t say there won’t be road accidents.”
Reuters also provided the most detailed account yet of how Shetty was able to circulate the fraudulent letters to other Indian banks...
According to court documents filed on Saturday by the CBI, branch deputy manager Gokulnath Shetty issued a series of fraudulent Letters of Undertaking – essentially guarantees sent to other banks so that they would provide loans to a customer, in this case a group of Indian jewelry companies.
These letters were sent to overseas branches of banks, thought to be almost all Indian, that would then lend money to the jewelry firms.
Shetty did so using the bank’s SWIFT system to log in with passwords that allowed him, and in at least some instances a more junior official, to serve as both the person who sent messages and as the person who reviewed them for approval, according to court documents and interviews with bank executives.
“The involvement and connivance of more staff members and outsiders at this stage cannot be ruled out,” said a CBI document submitted to the court in Mumbai.
...
After entering the transactions on SWIFT, the CBI documents said, Shetty – who worked at the same branch from 2010 to 2017 despite normal bank practices of regular rotations - did not record them on the bank’s internal system.
Because PNB’s internal software system was not linked with SWIFT, employees were expected to manually log SWIFT activity. If that was not done, the transactions did not show up on the bank’s books.
A SWIFT spokeswoman said in a statement last week that the company does not comment on individual customers.
All together, there were at least 150 such fraudulent Letters of Undertaking during a seven-year period, according to a CBI official who spoke on the condition of anonymity.
As one of the bank's auditors' said, the fraudulent transactions was "off books".
The mechanics of how the fraud happened, and what it says about the underlying industry culture, are worrying, said Abizer Diwanji, national leader for financial services in India at accounting firm Ernst & Young.
“Checks and balances are there in public banks as well but they are not followed earnestly,” said Diwanji, who has tracked India’s financial services industry for more than two decades.
“This is where the discipline, the culture is not there. I always believe that we don’t have the culture to manage risks, even operational risks. PNB is not an outlier in this.”
To control such risks, most private sector banks require branches to route SWIFT messages through their central offices, Diwanji said. They also usually integrate their own software systems and SWIFT, meaning that activity such as a Letter of Undertaking being sent would get automatically recorded.
Neither is the case at PNB or most state-run banks in India, Diwanji said.
Representatives of two of the external audit firms listed on PNB’s annual report for the 2016-17 fiscal year said they could not have known what happened.
“It was off-books, so auditors will not be in a position to detect it,” said Sudesh Punhani, a partner at Chhajed & Doshi.
The question now is: Will Indian banking regulators make the hard but necessary decision to force banks to integrate their systems with SWIFT while strengthening other oversight tools? Even if it risks uncovering other embarrassing fraud cases?
Remember, it was just October, when we discussed Indian Prime Minister, Narendra Modi’s, decision to hand over $32bn to recapitalize India’s state banks. The motivation was India’s slowing growth rate and the need to add one million Indians to the workforce every month. India has the second highest bad debt ratio of the world’s largest economies – possibly third since China’s official figure is patently incorrect.
Crippled by massive bad debts, the state-owned banks were struggling to extend more credit to the economy. The announcement caused a surge in India’s Sensex equity index, led by the banks.
So much for that? Time for another bailout!!

In the red corner we have Mario Draghi, who runs the world's biggest and most activist central bank... and in the blue corner we have Ray Dalio, who runs the world's biggest hedge fund and has been systematically betting against the companies backstopped by his opponent.
They are set for a historic clash.
* * *
Less than a week ago, we were surprised to learn that what was until the start of the month "only" a $3 billion short bet against a broad selection of Europe's most popular public companies, had grown into a massive $13 billion basket of shorts. Well, fast forward to today when according to the latest breakdown of his filings by Reuters, Ray Dalio has been especially busy, and since last Friday he added another $9 billion shorts, bringing Bridgewater's total short against some of the continent’s biggest companies to a record $22 billion.
While there was no offsetting data to show whether the $160 billion in AUM Bridgewater holds more European stocks than it “shorts” overall, an investor in the hedge fund firm’s Pure Alpha Major Markets strategy said that the fund had reduced its long exposure significantly this year.
And although the filings do not say when Bridgewater first took out its European short positions - our first report of Dalio's European short was back in October when the fund had a tiny $700 million short - many of its latest disclosures are recent, with some in Germany, Italy and France in the past two weeks.
As shown in the breakdown below, Bridgewater has bet against firms ranging from Anglo-Dutch consumer giant Unilever to French oil giant Total, and virtually every single prominent public bank.
Since Bridgewater is not known for picking individual stocks, the manager’s position was the result of a view on the wider economy according to James Helliwell, chief investment strategist of the Lex van Dam Trading Academy.
"Whilst the extent to which it may be an outright short bet is uncertain, I suspect that it was seen as a relatively cheap hedge against existing global equity exposure."
Broken down geographically, Bridgewater’s short positions are the highest in Germany with $7.3 billion, followed by France with $4.5 billion while in Spain its shorts in four groups amount to almost €1.4 billion ($1.7 billion) and in Italy include Unicredit and Enel. The portfolio has been fluid, adjusting its trades and recently cutting back on shorts in the Netherlands, Spain and Ireland, while increasing them in Germany and Italy.
Overall, traders told Reuters that the bets could be because Bridgewater is either expecting the stock market to fall or they are a play on the broader macroeconomic environment - hurting companies with large business exposures in the United States.
Below is a list of the European companies in which Bridgewater has taken short bets on in the past few weeks. The table discloses the latest available data on the 59 European companies where the Bridgewater stake has triggered reporting obligations by the respective financial market regulators.
And the top 30 shorts, charted.

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Phil Murphy, the front-runner in New Jersey’s Democratic gubernatorial primary, faces new questions about his tenure at Wall Street giant Goldman Sachs with the election just days away.
The campaign of attorney Jim Johnson, Murphy’s closest competitor in the race, criticized Murphy for serving as president of Goldman Sachs Asia at a time when the division profited from an investment in Yue Yuen Industrial, a Taiwan-based shoemaker. Human rights groups claim to have documented widespread labor abuses by Yue Yuen, including the company docking workers’ already modest pay for mistakes and running factories where machines sometimes severed workers’ hands and fingers, according to an NJ Advance Media report.
“Murphy’s record at Goldman Sachs undercuts what he says on the campaign trail to working families, and it shows that he should not be trusted when he promises to disavow money in politics,” Johnson campaign manager Jocelyn Steinberg said in a Friday statement. “Voters in New Jersey don’t need any more political gimmicks ― they deserve an explanation from Phil Murphy about his time at Goldman Sachs before they head to the polls on June 6.”
Murphy’s campaign did not immediately respond to a request for comment from HuffPost, but provided a statement to NJ Advance Media.
“These investments were made by a committee at Goldman Sachs’ main office in New York with which Phil had no involvement, well before Phil relocated from Germany to Hong Kong to run Goldman Sachs’ office in Asia,” Murphy spokeswoman Julie Roginsky said in a statement. “Suggesting that Phil is accountable for the decisions of others is irresponsibly deceitful and holds him to an unreasonable standard.”
Johnson, 56, a senior Treasury Department official in the Bill Clinton administration, has spent the last several years practicing civil rights law, fighting for greater police accountability. If elected, he would be the Garden State’s first African-American governor.
Johnson has nonetheless had a hard time establishing himself as the race’s true progressive, notwithstanding Murphy’s history at the controversial Goldman Sachs and the wave of anti-elite populism sweeping both major parties.
Murphy, 59, an ambassador to Germany during the Barack Obama administration, has poured more than $20 million of his own money into his bid, securing the endorsements of major labor unions and former Vice President Joe Biden. He has silenced would-be criticism with an unabashedly liberal platform of support for the $15 minimum wage, marijuana legalization and the creation of a public bank.
Polling is sparse in the race, but in a May poll conducted by Stockton University, Murphy had a lead of 24 percentage points over Johnson. Other candidates trailing Johnson include Assemblyman John Wisniewski, who chaired Vermont Sen. Bernie Sanders’ presidential campaign in the state, and state Sen. Ray Lesniak. (Sanders has not endorsed in the race, but his son Levi is backing Murphy.)
Candidates from both parties compete in primaries this Tuesday, and the general election will be on Nov. 7. Lt. Gov. Kim Guadagno is favored to become the Republican nominee for governor.
The race has thus far received little of the attention lavished on the gubernatorial race taking place in Virginia this November or the special congressional elections that will occur in the meantime.
But New Jersey presents a prime opportunity for Democrats to flip a governorship and add to a very limited tally of states where they control all branches of state government. Outgoing Republican Gov. Chris Christie has plummeted in popularity, and former Secretary of State Hillary Clinton beat President Donald Trump by 14 percentage points in the state, making it ripe territory for a Democratic pickup. -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.

As Trump stumbles, and maybe crumbles, progressives are confronting a painful truth: Trump is a reflection of a much bigger problem ― the rise of runaway inequality and the failure of the liberal establishment to address it.
Between 1980 and 2014, the gap between the top 100 CEOs and the average worker climbed from $40 to one to an incredible $844 to one. All boats did not rise. During that time the real income of the average worker (after accounting for inflation) actually declined. Both Republicans and Democrats alike rushed to deregulate Wall Street, which is a major cause of these enormous gaps.
The Democrats, who once spoke for these working people, are in real danger of losing them. Since 2008, they have given up 917 state, local and federal elected offices. There are now 33 Republic governorships.
Who’s to blame?
In workshops around the country, we’ve been asking participants why Trump won. The answers primarily focus on the Comey letter, Hillary as a poor candidate, the Russian hacking, anti-establishment protest, homophobia, racism, xenophobia, and so on..
In no instance is there any self-reflection from progressives about our own role in any of this. Isn’t it possible that maybe, just maybe, the enormous rightward drift has something to do with us ― with how progressives are organized and disorganized? At the very least, we should admit the obvious: all of this happened and continues to happen on our watch. To not take some responsibility for this growing calamity is to concede that we have no agency, no power, and no effective strategy to forge meaningful social change.
The Hazards of Silo Organizing
For the last generation, progressives have organized themselves into issue silos, each with its own agenda. Survival depends on fundraising (largely from private foundations) based on the uniqueness of one’s own silo. Each group must develop its own expertise and activities which distinguish it from other groups. Each needs to proclaim that its issue is the existential threat, be it climate change, police violence, abortion rights or health care. The net result of this Darwinian struggle is a fractured landscape of activity. The creativity, talent and skill are there in abundance, but the coherence and common purpose among groups is not.
Siloed organizational structures also make it extremely difficult to cooperate on a common program to reverse runaway inequality, There is little incentive to form a grand progressive alliance to build what the Sanders campaign, for example, had set in motion. Better to launch your own national effort and claim that it is the center of the organizing universe.
It is therefore not surprising that the two biggest progressive challenges to runaway inequality in the last decade ― Occupy Wall Street and the Sanders campaign ― did not arise from within these siloed organizations. OWS largely grew from a notice in Adbusters, a Vancouver, BC, journal. Most of those who did the occupying at the 900 encampments also did not come from progressive siloed organizations. In fact, the non-profit/NGO community more or less watched from the sidelines.
Similarly, the Sanders campaign also did not emerge from a concerted effort among progressives to create a new politics within the Democratic Party. Rather, it was driven by Bernie’s own social-democratic vision that he had been espousing for over 40 years, year after year after year. When his effort showed signs of life, progressives broadly divided between the idealists feeling the burn and the pragmatists seeking to back a sure winner, who at least would provide access to progressive ideas.
Talking to Ourselves?
The advent of Trump certainly has unleashed an enormous amount of progressive activity. In addition to the many sizeable marches, there are now approximately 5,000 Indivisible groups making life miserable for Republican office holders. However, nearly all of this activity is anti-Trump and defensive. There is no common Indivisible national agenda, nor is there a common organization to set a coherent strategic direction.
More importantly, pure anti-Trumpism guarantees we will be talking to the already convinced. By focusing solely on Trump, it becomes next to impossible to reach the Trump voters who also voted for Sanders and Obama.
Some argue that such outreach is a waste of time because there really are not that many Obama-to-Sanders-to-Trump voters. Unfortunately, exit polls do not give us enough data to reasonably estimate the size of this hybrid voting population. But sources inside the United Steelworkers, for example, report that 50 percent of their members who voted, voted for Trump. Given how representative those members are of the broader working class, we’re probably looking at several million Obama-Sanders-Trump voters.
We do know this: In the state of Michigan there was a 500,000 vote loss from Obama (2012) to Clinton (2016). It was minus 290,000 in Pennsylvania and minus 222,000 in Wisconsin.
Very few, if any of our siloed progressive organizations are targeting these working people. Danger ahead.
The Deplorables?
It will not be easy for progressive to reach out to Trump voters, unionized or not. In part, that is because anti-Trump defensive activity has become the basis for a new wave of silo organizing and fundraising. Each group is claiming that its activities will be the most effective means for upending the Trump agenda and returning Congress to the Democrats.
The animosity towards Trump voters runs deep. One prominent progressive educator told me privately that Trump voters should be viewed as terrorists ― that their anti-establishment revolt was like throwing a grenade into a crowd, and we’re the collateral damage. Others argue that the Trump voters really are “deplorables” when it comes to their racism, sexism and anti-immigrant beliefs.
The suspicion also spreads to those who do want to reach out to these Obama-Sanders-Trump voters. They are often criticized for favoring class over race ― for failing to put anti-racism as the central feature of all organizing and educational efforts. So for example, if addressing “white skin privilege” is not a major part of the education, then the education is viewed as catering to the racist white working class.
This can cascade into a series of litmus tests on race, gender, immigration, abortion, global warming, etc that must be passed in order to be welcomed into the progressive community. While there is no denying that these issues are of critical importance, the net effect of administering such tests is that progressives will be stuck within their own bubbles.
The Power of Education:
We’re facing a moment of truth about education and social change. We need to decide whether or not we believe that real education about big picture issues can make a difference in how people see the world. This kind of education is not the same as campaign propaganda, sound bite memes or technical training about how to get out the vote or organize an action. It’s about building a broad-based discussion on how the economy works and doesn’t work, and how to make it serve us all. Here are some of its features:
1. Placing a Target on Wall Street: By showing how and why society is growing more unequal, runaway inequality education (see runawayinequality.org) lays bare the ways in which Wall Street and its CEO partners engage in financial strip-mining, ― the immoral siphoning away of wealth from our jobs, communities and families. The weapons of financial engineering are many including mortgage fraud, high interest student loans, stock buybacks, payday loans, too big to fail/jail, bailouts, tax loopholes, tax breaks, off-shore accounts, privatization of public assets, and many, many more. None of our silos are immune from ravages of financial strip-mining
2. Building Common Ground: Big picture education can tie together virtually all the issues that we care deeply about. Runaway inequality and runaway finance are linked to runaway global warming. The forces causing runaway inequality are connected to the rise of the prison population and the expansion of private prisons where we now warehouse millions of our impoverished youth. It’s tied to the attack on union rights, the decline of good paying jobs, the harassment of immigrants and the failure of our corporate-run health care system. This educational process helps us see that our issue silos are in fact deeply connected.
3. Safe space for Dialogue: A strong educational process provides an excellent venue to have dialogue with those that do not immediately share every progressive value or position. I’ve done runaway inequality workshops with Trump voters and the response has been positive. They too want to understand why the richest country in the history of the world cannot provide decent paying jobs and adequate public services for all its people.
4. Developing and Spreading a Common Agenda: Such an educational process also leads naturally to testing and sharing a common agenda to reverse runaway inequality. Such an agenda, in the form of a petition, can serve as an educational tool, and, if it catches on, a way to shift the public debate towards a social-democratic agenda. (See here for national polling results on how young people reacted to such an agenda.)
Learning from the Populists of the late 19th Century
Over a century ago, small farmers, black and white, in the Midwest and South organized a potent mass movement to challenge the power of Wall Street. They called for cooperative enterprises, public banks, public ownership of railroads and telegraph, a progressive income tax and many other limits on corporate power. Their agenda led to many state and nation reforms as well as paving the way for the New Deal and its tight controls on Wall Street.
The key to their organizational successes was education. They fielded 6,000 educators to help build their chapters and spread the word in the 1880s and 1890s. Today we would need about 30,000 to do the same, given the growth of our population.
Building such a network, however, requires having faith in the power of education. It requires that we understand that runaway inequality ties us all together and can only be tackled through a broad-based common movement with a common agenda. This educational process asks us to have the confidence and courage to engage in dialogue with a wide range of people who also care about building a better society for themselves and their families.
None of this will come easy. Our silos provide us with strength. We take pride in our identities and are empowered by them. Also, it is very difficult for us to even imagine what a common movement might look like, let alone how to build one. But we can be sure of one thing: Building a fairer and more just society will require a massive educational movement. As the Populists taught us, it can be done.
(For those willing to take that leap, please join us in building the runawayinequality.org educational network. We need you. We need each other.)
Les Leopold, the director of the Labor Institute, is currently working with labor unions and community organizations to build the runawayinequality.org educational network. His book Runaway Inequality: An Activist Guide to Economic Justice serves as a text for this educational campaign. All proceeds go to support these educational efforts. -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.

A new survey conducted by the Runawayinequality.org Educational Network shows that younger Americans (ages 18-40) overwhelmingly support bold proposals to reverse inequality―- Sanders-type policies such as Medicare for all, free higher education, ending mass incarceration, wealth taxes on multi-millionaires, financial speculation taxes on Wall Street, public banks, immigrants rights, worker rights, a guaranteed job at a living wage, campaign finance reform, and a sustainable environment.
Meanwhile, the Trump administration is accelerating inequality. The billionaire appointees, the Goldman Sachs economic advisors, the hollow healthcare and tax proposals all are designed to move more money into the hands of the few.
Unfortunately, the mainstream Democrats are hardly better when in comes to runaway inequality.
Over the last 37 years, America’s top 10 percent saw their incomes rise by 115 percent and the top 1 percent saw an incredible rise of 198 percent. Meanwhile, the bottom half of all American earners not only failed to see any gain at all, but their incomes actually declined by 1 percent from 1978 to 2015, according to research by Thomas Piketty.
During the Obama years “the top 1 percent of families captured 52 percent of total real income growth per family from 2009 to 2015 while the bottom 99 percent of families got only 48 percent of total real income growth,” reports inequality expert, Emanuel Saez
Most politicians and pundits throw their hands up in despair. They argue there is really nothing we can do about rising inequality because of the powerful impacts of global competition and automation. Those who are falling behind just don’t have the skills needed to prosper in the modern world. Life is unfair. Get used to it.
But these fatalists are dead wrong. There is ample evidence to show that many other nations have far less inequality but also deploy the most advanced technologies, and are even more open to foreign competition. (See here.)
Furthermore, the mainstream Democrats have convinced themselves, that despite the Sanders surge, most Americans do not support bold policies to reverse runaway inequality — too “socialistic.”
Does a social democratic program appeal to most Americans?
We decided to test the mainstream Democratic Party phobias by asking 200 randomly selected 18 to 40 year-olds to evaluate a strong platform aimed at reversing runaway inequality.
(The response choices were “Strongly Agree”, “Neutral,” “Disagree,” “Strongly Disagree.” The results below combine the “Strongly Agree/Agree” categories, and the “Strongly Disagree/Disagree” categories. Given the sample size the margin of error is a 7 percent. The survey was conducted April 20-22 via SurveyMonkey.)
The results clearly demonstrate that these younger people are more than willing to embrace bold proposals. (Please keep in mind that approximately 30 to 40 percent of these respondents were likely Trump voters.)
Money and Politics: The right to fair and equal representation, free from voter suppression and the influence of big money. For our democracy to endure, we must overturn Citizens United, enact public campaign financing and enforce the Voting Rights Act. Agree: 65.8%, Disagree: 5.0%
Medicare for All: The right to universal health care. Expand and improve Medicare (for All) to provide every American with access to quality, affordable healthcare. Agree: 75.6%, Disagree: 12.7%
Environmental Protection: To prevent catastrophic damage to our planet’s life support systems, we must accelerate the transition to a clean energy economy; protect our water and air from pollution; and prevent companies from moving to countries with weaker health, safety and environmental standards. Agree: 84.5%, Disagree: 4.0%
Job at a living wage: Everyone who is willing and able to work is entitled to a decent paying job in a safe and healthy workplace. If the private sector can’t provide such jobs, then the public sector should. Agree: 65.0%, Disagree: 20.5%
Free Public Education: The right to free public education from pre-K through college or trade school. Pre-K for 2- to 5-year olds should be available free of charge for all families. And everyone who qualifies for entrance to higher education should be able to attend tuition free. Agree: 72.0%, Disagree: 13.0%
Impartial criminal justice: Biased law enforcement in poor urban and rural communities must be ended, and we must stop using mass incarceration as a substitute for decent employment and educational opportunities. Agree: 75.1%, Disagree: 16.9%
Pathway to citizenship: Every resident of the US should have a comprehensive pathway to citizenship, and be afforded the rights to due process and a fair hearing that the Constitution guarantees to all. Agree: 68.2%, Disagree: 10.4%
Worker Rights: To protect and enhance worker rights and fairness on the job, the freedom to unionize, free from employer coercion, must be promoted. Agree: 58.6%, Disagree: 10.5%
Public Banks: As an alternative to Wall Street’s predatory lending, every state should charter a public bank, modeled on the Bank of North Dakota, whose first and only goal is to serve its people. Also, like many other developed nations, the US should charter a national postal bank to provide fair and accessible financial services in all our communities. Agree: 59.0%, Disagree: 9.5%
Taxing Wall Street: To move money to Main Street, a small sales tax should be imposed on stocks, bonds and derivatives. This also would discourage high frequency computer trades which make up the majority of all stock market activity. Agree: 49.0, Disagree: 10.7%
End Stock Manipulation: CEOs and their Wall Street partners should not be permitted to enrich themselves by using corporate funds to buy back their own shares in order to artificially raise share prices. This was illegal before 1982 and should be again. Agree: 71.5%, Disagree: 6.5%
Wealth Tax of 1% on those whose net worth is over $10 million: Those who have grown super-rich in our financialized economy must pay their fair share of taxes. A wealth tax, currently used by Spain, France, Switzerland and Norway, is an excellent way to recoup those losses. Agree: 72.1%, Disagree: 10.1%
What will it take to wake up the Corporate Democrats?
The Democratic Party is trying to move “economic issues” into their core message. That’s not good enough. As we see from our survey, younger Americans in particular are hungry for more than platitudes about economic opportunity, public-private partnerships, reduced tuition loans and other half measures.
What the Democrats are offering can be co-opted by Trump’s faux populism. But a strong agenda to reverse runaway inequality cannot.
Rather than embrace these proposals mainstream Democrats are likely to reject our survey because it doesn’t jive with the milquetoast questions posed by their high-priced pollsters, and because it challenges their cozy relationships with Wall Street and corporate elites.
But we can’t afford to sit around and moan this sorry state of affairs. Millions are in motion and eager to get more involved. We need to break through the false narratives and continue to prove that Americans want a much fairer society.
For starters, we could turn this agenda into a circulating petition, get 20 million or so to sign it, and then shove it in the face of every politician. Then maybe, just maybe, we’ll see growing support for real policies to reverse runaway inequality.
If you’re interested in helping out, check out runawayinequality.org We need you. We need each other.
(In honor of Trump’s first 100 days, we’re having a week-long e-book sale for Runaway Inequality: An Activist Guide to Economic Justice. ― $4.99 on Amazon, Barnes and Noble and Apple. All proceeds go to support these educational efforts.)
This article originally appeared on Alternet.org
Les Leopold, the director of the Labor Institute, is currently working with unions and community organizations to build the educational infrastructure of a new “reversing runaway inequality” movement. For more information, contact runawayinequality.org.
-- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.

My easy like Sunday morning reads: • Oral history: Prince’s life, as told by the people who knew him best (StarTribune) • French election explained in five charts (BBC) • Calpers Is Sick of Paying Too Much for Private Equity (Wall Street Journal) • Weed Strains Are Mostly Bullshit (Vice) see also Public banking goes to pot (High Country…
Read More
The post 10 Sunday Reads appeared first on The Big Picture.

As a society obsessed by money, we pay a gigantic price for not educating high school and college students about money and banking. The ways of the giant global banks – both commercial and investment operations – are as mysterious as they are damaging to the people. Big banks use the Federal Reserve to maximize their influence and profits. The federal Freedom of Information Act provides an exemption for matters that are “contained in or related to examination, operating, or condition reports prepared by, on behalf of, or for the use of an agency responsible for the regulation or supervision of financial institutions.” This exemption allows financial institutions to wallow in secrecy. Financial institutions are so influential in Congress that Senator Durbin (D, IL) says “[The banks] frankly own this place.”
Although anti-union, giant financial institutions have significant influence over the investments of worker pension funds. Their certainty of being bailed out because they are seen as “too big to fail” harms the competitiveness of smaller, community banks and allows the big bankers to take bigger risks with “other people’s money,” as Justice Brandeis put it.
These big banks are so pervasive in their reach that even unions and progressive media, such as The Nation magazine and Democracy Now have their accounts with JP Morgan Chase.
The government allows banks to have concentrated power. Taxpayers and Consumers are charged excessive fees and paid paltry interest rates on savings. The bonds of municipalities are are also hit with staggering fees and public assets like highways and public drinking water systems are corporatized by Goldman Sachs and other privatizers with sweetheart multi-decade leases.
Then there are the immense taxpayer bailouts of Wall Street, such as those in 2008-2009 after the financial industry’s recklessness and crimes brought down the economy, cost workers 8 million jobs, and shredded the pension and mutual fund savings of the American people.
Standing like a beacon of stability, responsiveness and profitability is the 98 year-old, state-owned Bank of North Dakota (BND). As reported by Ellen Brown, prolific author and founder of the Public Banking Institute (Santa Clarita, California), “The BND has had record profits for the last 12 years” (avoiding the Wall Street crash) “each year outperforming the last. In 2015 it reported $130.7 million in earnings, total assets of $7.4 billion, capital of $749 million, and a return on investment of a whopping 18.1 percent. Its lending portfolio grew by $486 million, a 12.7 percent increase, with growth in all four of its areas of concentration: agriculture, business, residential and student loans…”
North Dakota’s economy is depressed because of the sharp drop in oil prices. So the BND moved to help. Again, Ellen Brown:
In 2015, it introduced new infrastructure programs to improve access to medical facilities, remodel or construct new schools, and build new road and water infrastructure. The Farm Financial Stability Loan was introduced to assist farmers affected by low commodity prices or below-average crop production. The BND also helped fund 300 new businesses.
All this is in a state with half the population of Phoenix or Philadelphia.
A California coalition is forming to establish a state-owned bank for California. Coalition organizers say a California State Bank will cut the state’s long-term financing costs in half, compared to what avaricious Wall Street is charging. The nation’s largest state (equivalent to the world’s sixth largest economy) can free itself from massive debt accumulation, bid-rigging, deceptive interest-rate swaps and capital appreciation bonds at 300% interest over time.
What assets does the state have to make this bank fully operational? California has surplus funds which total about $600 billion, including those in a Pooled Money Investment account managed by the State Treasurer that contains $54 billion earning less than 1 percent interest.
Money in these funds is earmarked for specific expenditure purposes, but they can be invested – in a new state bank. To escape from a Wall Street that is, in Brown’s words “sucking massive sums in interest, fees and interest rate swap payments out of California and into offshore tax havens,” a state bank can use its impressive credit power to develop infrastructure in California.
Huge state pension funds and other state funds can provide the deposits. Each one billion dollar capital investment can lend $10 billion for projects less expensively and under open stable banking control by California. Presently, California and other states routinely deposit hundreds of billions of dollars in Wall Street banks at minimal interest, turn around and borrow for infrastructure construction and repair from the Wall Street bond market at much higher interest and fees.
This is a ridiculous form of debt peonage, a lesson Governor Jerry Brown has yet to learn. He and other officials similarly uninformed about how the state of California can be its own banker should visit publicbankinginstitute.org and read Ellen Brown’s book, The Public Bank Solution.
Legislation for public banks is being pursued in the states of Washington, Michigan, Arizona and New Jersey, as well as the cities of Philadelphia and Santa Fe. Look for county commissioners and state treasurers to come on board when they see the enormous safeguards and savings that can be secured through “public banks” in contrast to the convoluted casino run by unaccountable Wall Street gamblers and speculators.
A longtime backer of public banking, retired entrepreneur Richard Mazess, hopes that national civic groups like Public Citizen, Common Cause, People for the American Way and Consumer Watchdog can get behind the proposal. “Public, not private, infrastructure is essential for an equitable economy,” he says.
California already has a public infrastructure bank called the IBank. Mr. Mazess and others believe that expanding the existing IBank into a depository institution would be more likely to pass through the California legislature. The deposits would come from public institutions, and NGOs (not from private persons). These pension funds and other public deposits would become reserves and serve as the basis for safely leveraged loans to public projects at a conservative tenfold multiplier. No derivatives or other shenanigans allowed.
Before that proposal can be enacted, however, there needs to be much more education of state legislators and the public at large.
Such enlightenment would illuminate the enormous savings, along with the restoration of state sovereignty from the absentee, exploitative grip of an unrepentant, speculating, profiteering Wall Street that believes it can always go to Washington, DC for its taxpayer bailouts. -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.

“C’mon, fellas. You know what this is? You know what this says? You’re going back to work.” ― Donald Trump on signing an executive order to reverse the Obama Administration’s rules on coal, March 28, 2017.
Lyndon Baines Johnson in 1964 buried Barry Goldwater in West Virginia, 67.9 percent to 32.1 percent. By 2016, Trump completely reversed that landslide by defeating Hillary Clinton 67.9 percent to 26.2 percent. What happened to turn such a deep blue state into flaming red?
The Democratic Party establishment has a simple explanation: West Virginians are so hung up on cultural issues like guns, gays, abortion and their mythical self-image as “coal country” that they vote against their own material interests. They seem impervious to the fact that they are major beneficiaries of Obamacare and Medicaid. They don’t seem to notice that health care jobs far exceed coal-related jobs which have been decimated by new technologies, and market competition from natural gas and renewables.
As New York Times columnist Paul Krugman recently writes, “So West Virginia voted overwhelmingly against its own interests. ....Coal country residents.... were voting on behalf of a story their region tells about itself, a story that hasn’t been true for a generation or more.”
The Democrat Party’s Love Affair with Neoliberalism
But is the real problem inside the heads of West Virginians? Or is it in the story the Democrats have been telling themselves for the past 40 years ― namely that neoliberal capitalism can solve all problems by making the rich even richer?
Ever since Bill Clinton triangulated the Democrats onto Wall Street and declared “the era of big government is over,” the neoliberal catechism has spread throughout both political parties - that unleashing the private sector will bring jobs and prosperity to all.
Hillary Clinton, to her credit, candidly revealed during the primaries just how she would use neoliberalism to turnaround West Virginia’s economy.
I’m the only candidate which has a policy about how to bring economic opportunity using clean renewable energy as the key into coal country. Because we’re going to put a lot of coal miners and coal companies out of business, right? .... Now we’ve got to move away from coal and all the other fossil fuels, but I don’t want to move away from the people who did the best they could to produce the energy that we relied on. ... So I am passionate about this, which is why I have put forward specific plans about how we incentivize more jobs, more investment in poor communities, and put people to work.
Her passion for “incentivizing” private investment with government tax breaks and cash is at the core of Democratic neoliberalism. Put simply the idea is to bribe the private sector to come into hard hit areas like West Virginia to create jobs.
Except this never happens. Bill Clinton and Barak Obama failed to bring a modicum of economic prosperity to West Virginia. Donald Trump’s deregulatory approach will also leave West Virginia in poverty. The fact is that encouraging the rich to make more and more money does not create good paying jobs. For at least 40 years this has failed miserably leading to an ever increasing gap between the super-rich and the rest of us. (See here.)
Contrast this failed approach to the Democratic Party of FDR, JFK and LBJ. Those presidents, though staunch defenders of capitalism, understood that the excruciating poverty of Appalachia could not be cured by free enterprise alone. They made a difference through direct government interventions. The New Deal put the unemployed back to work building hundreds of parks, roads and other facilities in West Virginia.. The creation of Social Security supported the elderly. The Kennedy-Johnson administration provided Medicare and Medicaid. Little wonder that West Virginians idolized these Democratic leaders.
Those days are over. Coal isn’t coming back, nor should it. West Virginia however remains poor and will become even more so unless the federal government intervenes directly.
A real economic transformation for Coal Country?
The alternative to economic and environmental devastation is for the federal government to guarantee all the unemployed in West Virginia a job at a living wage. And there’s plenty to do. Tens of thousands of workers could be employed to restore in some way the mountain tops that have been removed to satiate the greed of the coal mine owners. Following the New Deal’s WPA model, these scarred mountains could be turned into recreation sites, locations for alternative energy or other uses limited only by our creativity and imagination.
To protect the population and create more jobs, Medicare should be improved and expanded to cover all West Virginians. Free pre-k programs should be made available for 2- to 5-year olds, and tuition eliminated at all public post-high school educational institutions. And for those who want to leave the area to seek employment in other regions, moving expenses should be provided.
While we may disagree on the mix of policy interventions needed, the point is that only massive government intervention can bring shared prosperity to West Virginians.
Will environmentalists abandon neoliberal wishful thinking?
Environmental activists want to shut down the coal industry and for good reason. They are rightly concerned that unless fossil fuel emissions are dramatically curtailed, we will cook the planet.
Environmental groups use the phrase “just transition” to explain how current fossil fuel workers and their communities can move to a safer, more prosperous green economy. Yet too often this approach relies on the neoliberal model to get from here to there:
“There are more jobs now in alternative energy than there are in fossil fuels.” True enough. But there is no realistic path through which those with the old jobs get the new ones, which usually are located far away and pay far less.
“Coal miners are losing their jobs anyway due to technology. It’s just like the fate of elevator operators....” Yet there are still 116,000 coal mining jobs in West Virginia, where the next available job, if you are lucky enough to find one, pays less than half as much with no benefits.
“It’s really competition from natural gas and renewables that are putting coal out of business, not environmental regulations.” That may be the case but don’t we still have a real obligation to the dislocated, regardless of the proximate cause?
“Stopping the climate catastrophe is more important than jobs. End of story.” But that’s the start of a very bad story if it’s your job, your family’s livelihood and your community’s survival.
It’s a very positive development that environmental organizations are calling for a just transition. But that idea won’t work unless it also calls for direct government intervention backed by lots of money.
Where does the money come from? It comes from moving it from Wall Street to Main Street, through policies such as a financial transaction tax, public banks and wealth taxes on those with over $10 million in net assets. It comes from reversing runaway inequality, something corporate Democrats are loathe to discuss, let alone do something about.
Won’t Trump screw West Virginians even more?
Of course he will. He also believes that catering to the rich and powerful is what the economy is all about. But as long as the Democrats’ only vision is to offer public/private partnerships loaded with bribes and vague promises of future jobs, Trump has nothing to worry about.
So what can we do about it?
We need a new movement dedicated to reversing runaway inequality from the hollows of West Virginia to our urban inner cities, while dramatically curtailing greenhouse gases. This requires that labor, environmental and community activists build a common vision, a common agenda and a common organization.
To get from here to there requires that fossil fuel workers and environmentalists talk to each other. There is common ground to be found if we are willing to think outside the neoliberal box. Toward that end, our fledgling runawayinequality.org educational network is piloting blue-green workshops in which union and environmental activists discuss the connections between the financial strip-mining of our economy and the destruction of the environment. The initial results are promising but we have a long, long way to go and little time to get there. (See here).
We need to tell the story of why trickle down has failed and what real alternatives look like. And we need tens of thousands of people to help tell that story. (For more information about becoming a runawayinequality.org trainer, see here.)
Les Leopold, the director of the Labor Institute, is currently working with labor unions and community organizations to build the educational infrastructure for a new anti-Wall Street movement. His book Runaway Inequality: An Activist Guide to Economic Justice serves as a text for this educational campaign. All proceeds go to support these educational efforts. -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.

“C’mon, fellas. You know what this is? You know what this says? You’re going back to work.” ― Donald Trump on signing an executive order to reverse the Obama Administration’s rules on coal, March 28, 2017.
Lyndon Baines Johnson in 1964 buried Barry Goldwater in West Virginia, 67.9 percent to 32.1 percent. By 2016, Trump completely reversed that landslide by defeating Hillary Clinton 67.9 percent to 26.2 percent. What happened to turn such a deep blue state into flaming red?
The Democratic Party establishment has a simple explanation: West Virginians are so hung up on cultural issues like guns, gays, abortion and their mythical self-image as “coal country” that they vote against their own material interests. They seem impervious to the fact that they are major beneficiaries of Obamacare and Medicaid. They don’t seem to notice that health care jobs far exceed coal-related jobs which have been decimated by new technologies, and market competition from natural gas and renewables.
As New York Times columnist Paul Krugman recently writes, “So West Virginia voted overwhelmingly against its own interests. ....Coal country residents.... were voting on behalf of a story their region tells about itself, a story that hasn’t been true for a generation or more.”
The Democrat Party’s Love Affair with Neoliberalism
But is the real problem inside the heads of West Virginians? Or is it in the story the Democrats have been telling themselves for the past 40 years ― namely that neoliberal capitalism can solve all problems by making the rich even richer?
Ever since Bill Clinton triangulated the Democrats onto Wall Street and declared “the era of big government is over,” the neoliberal catechism has spread throughout both political parties - that unleashing the private sector will bring jobs and prosperity to all.
Hillary Clinton, to her credit, candidly revealed during the primaries just how she would use neoliberalism to turnaround West Virginia’s economy.
I’m the only candidate which has a policy about how to bring economic opportunity using clean renewable energy as the key into coal country. Because we’re going to put a lot of coal miners and coal companies out of business, right? .... Now we’ve got to move away from coal and all the other fossil fuels, but I don’t want to move away from the people who did the best they could to produce the energy that we relied on. ... So I am passionate about this, which is why I have put forward specific plans about how we incentivize more jobs, more investment in poor communities, and put people to work.
Her passion for “incentivizing” private investment with government tax breaks and cash is at the core of Democratic neoliberalism. Put simply the idea is to bribe the private sector to come into hard hit areas like West Virginia to create jobs.
Except this never happens. Bill Clinton and Barak Obama failed to bring a modicum of economic prosperity to West Virginia. Donald Trump’s deregulatory approach will also leave West Virginia in poverty. The fact is that encouraging the rich to make more and more money does not create good paying jobs. For at least 40 years this has failed miserably leading to an ever increasing gap between the super-rich and the rest of us. (See here.)
Contrast this failed approach to the Democratic Party of FDR, JFK and LBJ. Those presidents, though staunch defenders of capitalism, understood that the excruciating poverty of Appalachia could not be cured by free enterprise alone. They made a difference through direct government interventions. The New Deal put the unemployed back to work building hundreds of parks, roads and other facilities in West Virginia.. The creation of Social Security supported the elderly. The Kennedy-Johnson administration provided Medicare and Medicaid. Little wonder that West Virginians idolized these Democratic leaders.
Those days are over. Coal isn’t coming back, nor should it. West Virginia however remains poor and will become even more so unless the federal government intervenes directly.
A real economic transformation for Coal Country?
The alternative to economic and environmental devastation is for the federal government to guarantee all the unemployed in West Virginia a job at a living wage. And there’s plenty to do. Tens of thousands of workers could be employed to restore in some way the mountain tops that have been removed to satiate the greed of the coal mine owners. Following the New Deal’s WPA model, these scarred mountains could be turned into recreation sites, locations for alternative energy or other uses limited only by our creativity and imagination.
To protect the population and create more jobs, Medicare should be improved and expanded to cover all West Virginians. Free pre-k programs should be made available for 2- to 5-year olds, and tuition eliminated at all public post-high school educational institutions. And for those who want to leave the area to seek employment in other regions, moving expenses should be provided.
While we may disagree on the mix of policy interventions needed, the point is that only massive government intervention can bring shared prosperity to West Virginians.
Will environmentalists abandon neoliberal wishful thinking?
Environmental activists want to shut down the coal industry and for good reason. They are rightly concerned that unless fossil fuel emissions are dramatically curtailed, we will cook the planet.
Environmental groups use the phrase “just transition” to explain how current fossil fuel workers and their communities can move to a safer, more prosperous green economy. Yet too often this approach relies on the neoliberal model to get from here to there:
“There are more jobs now in alternative energy than there are in fossil fuels.” True enough. But there is no realistic path through which those with the old jobs get the new ones, which usually are located far away and pay far less.
“Coal miners are losing their jobs anyway due to technology. It’s just like the fate of elevator operators....” Yet there are still 116,000 coal mining jobs in West Virginia, where the next available job, if you are lucky enough to find one, pays less than half as much with no benefits.
“It’s really competition from natural gas and renewables that are putting coal out of business, not environmental regulations.” That may be the case but don’t we still have a real obligation to the dislocated, regardless of the proximate cause?
“Stopping the climate catastrophe is more important than jobs. End of story.” But that’s the start of a very bad story if it’s your job, your family’s livelihood and your community’s survival.
It’s a very positive development that environmental organizations are calling for a just transition. But that idea won’t work unless it also calls for direct government intervention backed by lots of money.
Where does the money come from? It comes from moving it from Wall Street to Main Street, through policies such as a financial transaction tax, public banks and wealth taxes on those with over $10 million in net assets. It comes from reversing runaway inequality, something corporate Democrats are loathe to discuss, let alone do something about.
Won’t Trump screw West Virginians even more?
Of course he will. He also believes that catering to the rich and powerful is what the economy is all about. But as long as the Democrats’ only vision is to offer public/private partnerships loaded with bribes and vague promises of future jobs, Trump has nothing to worry about.
So what can we do about it?
We need a new movement dedicated to reversing runaway inequality from the hollows of West Virginia to our urban inner cities, while dramatically curtailing greenhouse gases. This requires that labor, environmental and community activists build a common vision, a common agenda and a common organization.
To get from here to there requires that fossil fuel workers and environmentalists talk to each other. There is common ground to be found if we are willing to think outside the neoliberal box. Toward that end, our fledgling runawayinequality.org educational network is piloting blue-green workshops in which union and environmental activists discuss the connections between the financial strip-mining of our economy and the destruction of the environment. The initial results are promising but we have a long, long way to go and little time to get there. (See here).
We need to tell the story of why trickle down has failed and what real alternatives look like. And we need tens of thousands of people to help tell that story. (For more information about becoming a runawayinequality.org trainer, see here.)
Les Leopold, the director of the Labor Institute, is currently working with labor unions and community organizations to build the educational infrastructure for a new anti-Wall Street movement. His book Runaway Inequality: An Activist Guide to Economic Justice serves as a text for this educational campaign. All proceeds go to support these educational efforts. -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.

Bernie Sanders has the highest approval rating of any politician in the country with 61 percent approving, while only 32 percent disapproving, according to a March 15 Fox News poll. The Sanders 29 plus percent favorable/unfavorable gap is far superior to Trump’s negative 8 percent.
What accounts for Sanders popularity and how can progressives build on it?
Bernie Sanders has been saying the same things for nearly a half-century. He’s been a consistent democratic-socialist fighting in behalf of working people and against financial/corporate power. While his straightforward commitment to his ideals is refreshingly genuine, he did not make his mark on the national scene until last year at age 74.
Sanders didn’t change but the world did.
His message about the ravages and unfairness of runaway inequality hit home because it is true. He and his campaign became the next phase of the revolt against the one percent initiated by the remarkable, yet short-lived, Occupy Wall Street.
Sanders took this discontent many steps forward by clearly articulating a social-democratic agenda for working people. He turned “We are the 99%” into a clear policy agenda. That agenda, not just his enormous integrity, is why he remains so popular.
He stands for something and so should we.
Here’s a rough draft of such an agenda compiled from the many “Reversing Runaway Inequality” workshops being held across the country.
The right to a job at living wage: Everyone who is willing and able to work should be entitled to a job that today would pay at least $15 an hour. If the private sector is unable to produce such jobs, then government should serve as the employer of last resort. There’s more than enough work to be done to rebuild our infrastructure and protect our environment.
The right to universal health care: It is time to expand Medicare - our efficiently run single-payer system for the elderly ― to anyone who wishes to join. (See Labor for Single Payer)
The right to free public education from pre-k to graduate school: Each child deserves access free of charge to as much education as he or she qualifies for through our public educational systems. Nearly every economically advanced country provides free higher education. So should we. (See here.)
The right to a sustainable environment, free from chemical, radioactive and carbon pollution: We need to protect working people and communities from harmful exposures while rapidly reducing the emission of greenhouse gases ― the cause of global warming. The climate crisis is real and must be addressed now. In doing so we also should have a policy of buying goods as locally as possible to limit the carbon footprint of transportation, and we should make sure industries do not flee to countries with weaker health, safety and environmental standards.
The right to an impartial criminal justice system that does not harm anyone based on their ethnicity, gender, sexual orientation, racial category or religion. In particular, we need to dramatically reduce the differential impact of enforcement, prosecution and sentencing on young people of color.
The right to vote, free of voter suppression activities and billionaire influence: For our democracy to endure we need to halt any and all efforts to deny voting rights, and we need to curtail the influence of money in all areas of the political system.
The right to citizenship for all residents: We are a nation of immigrants, documented and undocumented. There should be a straightforward pathway to citizenship for the more than 11 million undocumented immigrants here today.
The right to organize unions without employer threats or harassment, We need to reform the current laws and processes which allow employers to intimidate workers from joining labor unions. Congress should pass the Free Choice Act which will level the playing field. (See here.)
The right to control our money through public state banks and a national postal bank: We need an alternative to the predatory financing provided by Wall Street. Modeled on the public Bank of North Dakota, every state should charter a public bank whose first and only goal is to serve its people. Like many other nations, we also need a national postal bank to provide financial services in all our communities. (See Public Banking Institute and Campaign for Postal Banking.)
But can America really afford these basic human rights?
We are the richest nation in world history. The resources are here, but our prosperity has been hijacked by financial and corporate elites. In 1970 the CEO pay/worker pay ratio was $45 to one. Today it is more than $840 to one.
The average worker who entered the workforce 40 years ago has lost more than $500,000 in productivity gains, according to Rutgers University professor Michael Merrill. From WWII to 1980, as productivity rose, so did real wages. Since 1980 real worker wages (after inflation) have stalled while productivity has soared. The productivity gains that once went to worker wages have been siphoned away to the top 1 percent. The average wage today would be double what it is, had we received our fair share of productivity.
Why?
Our economy is being financially strip-mined by Wall Street and their corporate partners. (Financial strip-mining refers to the full set of financial maneuvers that extract money from non-financial corporations and moves wealth to large investors, hedge funds, private equity companies, investment banks and insurance companies. Just as mineral strip-mining harms the natural environment, the financial kind damages the corporate environment and can leave behind hollowed-out facilities. See Runaway Inequality, Chapter 4).
This social-democratic agenda is possible if, and only if, financial strip-mining is halted. Billions of dollars of ill-gotten gains must be transferred from Wall Street to Main Street. Here are basic policies that can achieve that goal:
A Financial Speculation Tax on all Wall Street transactions: We should advocate a small sales tax on stocks (.05%), bonds (.01%) and derivatives (.005%). Wall Street must finally pay their fair share and repay us for all the bailouts. (See Robin Hood Tax)
An End to Stock Manipulation: This refers to stock buybacks that allow corporate and financial elites to strip-mine the economy. CEOs and their Wall Street partners should not be permitted to enrich themselves by using corporate funds to buy back their own shares in order to jack up stock prices. This was illegal before 1982 and should be again. (See “Profits Without Prosperity” by Professor William Lazonick)
A wealth tax of 1% on all those whose net worth is more than $10 million: Those who have grown super-rich by strip-mining our economy have a myriad of ways to avoid taxes. This tax, used by Spain, France, Switzerland and Norway is an excellent way to recoup those losses.
(Even Donald Trump once advocated a 14.25 percent wealth tax to eliminate the national debt. In 1999 he said:
“By my calculations, 1 percent of Americans, who control 90 percent of the wealth in this country, would be affected by my plan,”
Pie in the Sky?
Clearly, Donald Trump has long forgotten his wealth tax. Instead, he is hell bent on further increasing rather than reversing runaway inequality. So where is the political space for a Sanders-like agenda?
For a moment, think again about what has happened over this past year.
Who would have thought this pathological liar would become president?
Who really believed that Bernie Sanders, an avowed socialist, could come so near the Democratic nomination and become the most popular politician in America?
Who believed that millions of people would come into the streets so quickly and could organize thousands of Indivisible groups almost overnight?
There is a real opening for a visionary politics that protects and enhances the common good. But much more needs to be done to connect us together.
Petition every Politician?
To keep the Sanders agenda alive, we should further refine it, turn it into a petition, get 25 million people to sign it and shove it under the noses of every politician in the country.
Hard? Yes, but not impossible.
We can start right now by building a mass educational network that reaches millions of Americans with the facts about runaway inequality, financial strip-mining and why a powerful common agenda is both needed and possible. In the 1880s the Populists, who then were engaged in an all out war with the moneyed interests, fielded 6,000 educators to build their movement among small farmers. We need 30,000 today, a number well within our reach.
This educational effort can help us see that the many issues we care about are deeply connected by runaway inequality. It will help us see why we need a common movement that goes beyond our issue silos, interest groups and identities. It does not ask people to give up their issues and identities. Rather, it asks that we make issue silos more porous and interconnected.
It asks that we add one more identity to each of us ―- the identity of movement builder.
(For more information about this educational effort, please join us at runawayinequality.org.)
(This piece originally appeared on Alternet.org)
Les Leopold, the director of the Labor Institute, is currently working with labor unions and community organizations to build the educational infrastructure for a new anti-Wall Street movement. His book Runaway Inequality: An Activist Guide to Economic Justice serves as a text for this educational campaign. All proceeds go to support these educational efforts. -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.